the new chapter 78a regulations have arrived - pioga · page 4 the pioga press township, et al. v....

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October 2016 • Issue 78 The monthly newsletter of the Pennsylvania Independent Oil & Gas Association (Continues on page 3) (Continues on page 18) A fter years of rulemaking activity, the Pennsylvania Department of Environmental Protection’s new Chapter 78a regulations for surface activities associated with unconventional wells became effective on October 8. This article will review the status of the regulations and the next steps for implementing Chapter 78a across the Commonwealth. Timing The Chapter 78 (conventional wells) and 78a (unconventional wells) Subchapter C rulemaking was adopted in February by the Environmental Quality Board (EQB). However, as discussed in the July issue of The PIOGA Press, the passage of Act 52 of 2016 abrogated the portion of rulemaking applicable to conven- tional oil and gas development. After review by the Attorney General’s Office and the Commonwealth Joint Committee on Documents, DEP withdrew all proposed amendments applicable to conventional oil and gas wells, making changes in Chapter 78 The new Chapter 78a regulations have arrived Supreme Court strikes down several more Act 13 provisions T he Pennsylvania Supreme Court on September 28 struck down provisions of Act 13 dealing with Pennsylvania Public Utility Commission review of local ordinances, the so-called “physician gag rule,” Department of Environmental Protection notification of public water supply operators in the event of a spill and eminent domain powers for natural gas stor- age facilities. The 88-page majority opinion has been widely por- trayed as a defeat for the oil and gas industry, but in practical terms is antici- pated to have little effect on day-to-day operations. The action resolves outstanding mat- ters stemming from the court’s December 2013 Robinson Township v. Commonwealth of Pennsylvania deci- sion. In Robinson Township (described as Robinson II in the latest ruling), the PIOGA’s view on Chapter 78a rulemaking . . . 3 Save the date: 2017 Winter Meeting. . . . . . . . 4 Deadline extended on EPA discharge ban . . . 6 PIOGA Air Quality Compliance Training . . . . . 8 Don’t miss this special Annual Meeting . . . . . 9 Tax & accounting seminar coming up . . . . . . . 9 Promoting Pennsylvania’s energy assets . . . 10 New title and duties for Tracy . . . . . . . . . . . . 10 Burt Waite steps down from board . . . . . . . . 12 Divot Diggers Golf Outing . . . . . . . . . . . . . . . 13 DCNR’s updated state forest plan . . . . . . . . 14 McDonnell nominated DEP secretary. . . . . . 15 Are you using our Members Only system?. . 16 PIOGA Member News . . . . . . . . . . . . . . . . . 16 New members . . . . . . . . . . . . . . . . . . . . . . . . 17 Profile your company . . . . . . . . . . . . . . . . . . 17 Oil & Gas Trends . . . . . . . . . . . . . . . . . . . . . . 20 September Spud Report . . . . . . . . . . . . . . . . 22 Calendar of Events . . . . . . . . . . . . . . . . . . . . 23 PIOGA contacts . . . . . . . . . . . . . . . . . . . . . . 23 only to clarify its scope and remove all references to uncon- ventional wells. Chap- ter 78a will be pub- lished in substantially the same form as ap- proved by EQB in February and the Independent Regula- tory Review Commission in April. DEP published the final Chapter 78a rules, titled “Environmental Protection Performance Standards at Oil and Gas Well Sites,” in the Pennsylvania Bulletin on Saturday, October 8. The new rules became effective upon publication, with some provisions for future registration and modification of permitting facilities, such as fresh water and centralized impoundments. DEP was required to complete all the new forms and guidance referenced in Chapter 78a before publication. Jean M. Mosites Abigail F. Jones Authors:

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Page 1: The new Chapter 78a regulations have arrived - PIOGA · Page 4 The PIOGA Press Township, et al. v. Commonwealth of Pennsylvania, 623 Pa. 564, 83 A.3d 901(Pa. 2013); Robinson Township,

October 2016 • Issue 78The monthly newsletter of the Pennsylvania Independent Oil & Gas Association

(Continues on page 3)

(Continues on page 18)

After years of rulemaking activity, the PennsylvaniaDepartment of Environmental Protection’s new Chapter78a regulations for surface activities associated with

unconventional wells became effective on October 8. This articlewill review the status of the regulations and the next steps forimplementing Chapter 78a across the Commonwealth.

TimingThe Chapter 78 (conventional wells) and 78a (unconventional

wells) Subchapter C rulemaking was adopted in February by theEnvironmental Quality Board (EQB). However, as discussed inthe July issue of The PIOGA Press, the passage of Act 52 of2016 abrogated the portion of rulemaking applicable to conven-tional oil and gas development. After review by the AttorneyGeneral’s Office and the Commonwealth Joint Committee onDocuments, DEP withdrew all proposed amendments applicableto conventional oil and gas wells, making changes in Chapter 78

The new Chapter 78a regulations have arrived

Supreme Court strikes downseveral more Act 13 provisions

The Pennsylvania Supreme Court on September 28 struckdown provisions of Act 13 dealing with PennsylvaniaPublic Utility Commission review of local ordinances, the

so-called “physician gag rule,” Department of EnvironmentalProtection notification of public water supply operators in theevent of a spill and eminent domain powers for natural gas stor-age facilities. The 88-page majority opinion has been widely por-

trayed as a defeat for the oil and gasindustry, but in practical terms is antici-pated to have little effect on day-to-dayoperations.

The action resolves outstanding mat-ters stemming from the court’sDecember 2013 Robinson Township v.Commonwealth of Pennsylvania deci-sion. In Robinson Township (describedas Robinson II in the latest ruling), the

PIOGA’s view on Chapter 78a rulemaking . . . 3Save the date: 2017 Winter Meeting. . . . . . . . 4Deadline extended on EPA discharge ban . . . 6PIOGA Air Quality Compliance Training . . . . . 8Don’t miss this special Annual Meeting . . . . . 9Tax & accounting seminar coming up. . . . . . . 9Promoting Pennsylvania’s energy assets . . . 10New title and duties for Tracy . . . . . . . . . . . . 10Burt Waite steps down from board . . . . . . . . 12Divot Diggers Golf Outing . . . . . . . . . . . . . . . 13DCNR’s updated state forest plan . . . . . . . . 14

McDonnell nominated DEP secretary. . . . . . 15Are you using our Members Only system?. . 16PIOGA Member News . . . . . . . . . . . . . . . . . 16New members. . . . . . . . . . . . . . . . . . . . . . . . 17Profile your company . . . . . . . . . . . . . . . . . . 17Oil & Gas Trends. . . . . . . . . . . . . . . . . . . . . . 20September Spud Report . . . . . . . . . . . . . . . . 22Calendar of Events . . . . . . . . . . . . . . . . . . . . 23PIOGA contacts . . . . . . . . . . . . . . . . . . . . . . 23

only to clarify itsscope and remove allreferences to uncon-ventional wells. Chap -ter 78a will be pub-lished in substantiallythe same form as ap -proved by EQB inFeb ru ary and theIndependent Regula -tory Review Commission in April.

DEP published the finalChapter 78a rules, titled“Environmental ProtectionPerformance Standards at Oil and Gas Well Sites,” in thePennsylvania Bulletin on Saturday, October 8. The new rulesbecame effective upon publication, with some provisions forfuture registration and modification of permitting facilities, suchas fresh water and centralized impoundments. DEP was requiredto complete all the new forms and guidance referenced inChapter 78a before publication.

Jean M. Mosites Abigail F. Jones

Authors:

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Page 2 The PIOGA Press

Page 3: The new Chapter 78a regulations have arrived - PIOGA · Page 4 The PIOGA Press Township, et al. v. Commonwealth of Pennsylvania, 623 Pa. 564, 83 A.3d 901(Pa. 2013); Robinson Township,

February 2014 Page 3October 2016 Page 3

Chapter 78a regulations: Continued from page 1

TrainingIn August and September, DEP presented training webinars

on topics associated with the final Chapter 78a rulemaking foroperators, contractors and any other interested parties. Trainingtopics included pipelines and horizontal directional drilling,waste management, emergency response, secondary containment,spills and releases, well permits and reporting, water manage-ment plans, area of review, erosion control, and site restoration.Audio recordings of the webinars, along with DEP’s slideshows,are available for reference on DEP’s website. DEP has also creat-ed frequently asked questions (FAQ) documents for each webinartopic, covering matters that were raised by participants duringthe live training sessions. Full-day training sessions conductedby DEP in September covered the same material as the webinars.

Implementation To implement Chapter 78a, DEP has prepared or updated

more than 20 forms for unconventional operations. Many provi-sions of the new rules allow the agency to request information inaddition to what is specified in the regulations, making the formsthemselves a critical part of rule implementation. The new formsinclude a monthly tank maintenance checklist, well site restora-tion reporting forms, requests for approval of alternative wastemanagement practices and well site restoration extensions, and avariety of forms related to the Area of Review requirements in §78a.52a. All of the new forms are available on DEP’s eLibrary,www.elibrary.dep.state.pa.us/dsweb/HomePage.

Under Chapter 78a, almost all operator submissions arerequired to be electronic. The rules require unconventional oper-ators to submit notifications, requests, well permits and reportselectronically, and DEP states that it has updated its Greenportsystem to accept these submissions. The Greenport system has arevised version of “eWell” for electronic submissions of uncon-ventional well permits and an updated “DEP Notifications”application for well operator and pipeline operator notificationsto the department. DEP also created a new application,“eSubmission,” for reports and requests under other sections ofChapter 78a. For example, eSubmission will be used to requestextensions for the well site restoration period, to register borrowpits or underground tanks and to submit pre-drill survey sampleresults. DEP is providing webinars about the eWell, DEPNotifications and eSubmission applications in October, and therecorded webinars will be available on the agency’s website forfuture reference.

Pipeline operators in particular may be new to DEP’s elec-tronic reporting system because pipelines have never been withinthe scope of Chapter 78 until now. Under Section 78a.68a,pipeline operators conducting horizontal directional drilling(HDD) beneath a body of water or a watercourse are subject tonotification requirements. As a result, pipeline operators intend-ing to use HDD beneath water must register as users onGreenport if they are not currently registered. The rule requiressuch operators to use the DEP Notifications application inGreenport to notify DEP at least 24 hours prior to beginningHDD beneath a body of water or watercourse and, in the case ofa water supply complaint, to report the complaint to DEP within24 hours of receipt.

DEP will also be issuing several technical guidance docu-

PIOGA’s view on final publicationof the Chapter 78a rules:

“PIOGA is disappointed the department is making theseregulations effective. This action continues a flawed, pre-determined and antagonistic development process by anagency that ignored clear legislative directives and limi-tations. Our industry has been consistent in identifyingsignificant legal problems with these regulations, yet thedepartment has refused to change even the most glar-ing and obvious errors and overreaches. We will contin-ue to speak out against these regulations and defendthe rights of both conventional and unconventional oiland natural gas producers in Pennsylvania.”

—Dan Weaver, President & Executive Director

ments (TGDs) associated with the Chapter 78a rules, includingguidelines for implementing the Area of Review regulatoryrequirements and a policy on replacing and restoring privatewater supplies. Draft guidance documents on those two topicswere provided for public review at the Oil and Gas TechnicalAdvisory Board meeting in June and also were published in theOctober 8 Pennsylvania Bulletin as interim final rules, with a 60-day comment period. Industry representatives have participatedin the workgroups for these TGDs, but the final policies couldreflect additional public comment at the end of the commentperiod.

Major components of Chapter 78aUnconventional well operators should look closely at provi-

sions affecting well permitting, site construction, PPC plans, pre-fracturing diligence, waste handling, secondary containment,impoundments, pipelines, borrow pits, site restoration, waterreplacement and spill remediation. Each of these has a substan-tive change from existing law that will affect operations over thelife of the well.

One major revision to the rules arises in sections 78a.15(f)and (g), which set out the pre-application requirements for a wellpermit at a location that “may impact a public resource.” Thisprovision requires operators who propose to drill a well in suchlocations to notify the public resource agency, which now by def-inition includes schools, municipalities and owners of play-grounds or water supplies, and to provide additional informationto DEP. The regulation applies if the limit of disturbance of thewell site is located in any of eight specified areas, including “in alocation that will impact other critical communities” and “within200 feet of...a playground.” The public resource agency must benotified at least 30 days prior to the submission of the well per-mit application to DEP to allow the agency to provide writtencomments to DEP and the applicant. The applicant may providea response to the comments. DEP will then consider various fac-tors, including the comments submitted by both the publicresource agency and the applicant, before setting conditions forthe well permit based on impacts to public resources.

PIOGA has challenged EQB’s authority to promulgate thenew rules related to public resources in light of two PennsylvaniaSupreme Court decisions holding and clarifying that the statutoryauthority for such rulemaking has been enjoined. Robinson

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Page 4 The PIOGA Press

Township, et al. v. Commonwealth of Pennsylvania, 623 Pa. 564,83 A.3d 901(Pa. 2013); Robinson Township, et al. v.Commonwealth of Pennsylvania, —- A.3d —- (Pa. Sept. 28,2016). PIOGA filed an appeal of the Commonwealth Court deci-sion in PIOGA v. DEP, No. 321 MD. 2015, —-A.3d —-(Commw. Ct., Sept 1, 2016) in the Supreme Court on September29.

DEP has altered the water replacement/restoration standard inSection 78a.51(d)(2) to require replacement water supplies tomeet or exceed Safe Drinking Water Act (SDWA) standards,whereas the prior regulation required replacement water suppliesto meet SDWA standards or be comparable to the water qualityprior to impact if those supplies did not meet that standard. Ineffect, the SDWA is now the floor, rather than the ceiling for thewater quality standard of replacement water supplies. As PIOGAhas noted in its comments on the rulemaking, this obligation maycreate costly obligations, and in some cases, obligations that can-not be met even with the provision of a public drinking watersupply. In its comments, PIOGA has disagreed with DEP that thenew rule is the correct interpretation of Act 13, Section 3218(a).

An entirely new obligation is the Area of Review provision inSection 78a.52a, which requires operators to submit a reportidentifying the surface and bottom hole locations of active, inac-tive, orphan, abandoned, and plugged and abandoned wells with-in 1,000 feet of both the vertical and horizontal wellbores.Operators must review DEP’s well databases, review historicalsources of information and mail a questionnaire to landownerswithin the specified area in order to gather information.Operators must create a monitoring plan and provide notice, asnow required in Section 78a.73, to owners and operators of near-by wells that may penetrate the same formation being stimulatedin the new well. Operators must cease operations if communica-tion occurs and may not resume without DEP authorization.

The revised Section 78a.58 allows operators to conduct pro-cessing of fluids (including mine-influenced water) and drill cut-tings on the well site with DEP approval, similar to the existingOG-71 approval process. In addition, operators may mix fluids

with freshwater, aerate fluids and filter solids from fluids withoutDEP approval, provided that the activities are conducted withinsecondary containment. For any onsite processing activities, theoperator must develop an action plan for monitoring andresponding to radioactive materials.

The new rules completely overhaul the requirements forreporting and remediating spills. Section 78a.66 requires imme-diate reporting of spills that cause or threaten to pollute waters ofthe Commonwealth and requires reports within two hours for anyspill or release of 5 gallons or more over a 24-hour period that isnot completely contained on secondary containment.Remediation procedures for spills of at least 42 gallons (or spillsthat threaten to pollute waters of the Commonwealth) requireattainment of Act 2 standards within new reporting and time lim-its that are not required within Act 2 or applied to any otherindustry.

Finally, the use of pits for temporary storage on unconven-tional well sites is entirely prohibited under section 78a.56, andthree new provisions establish rules for off-site impoundments.Section 78a.59a sets requirements for impoundment embank-ments. Section 78a.59b provides for the registration, location andconstruction of well development impoundments (freshwaterimpoundments). The bottom of well development impoundmentsmust be at least 20 inches above the seasonal high groundwatertable, as certified by a soil scientist or similarly trained person.Section 78a.59c requires the closure of all centralized impound-ments within three years, unless a permit is obtained under theSolid Waste Management Act. Closure plans must be submittedwithin six months.

The department plans to begin revisions to Subchapter D ofChapter 78a, Well Drilling, Operations and Plugging, sometimelater this year. ■

For additional information about developments described in thisarticle, contact Jean M. Mosites at 412-394-6468 [email protected] or Abigail F. Jones at 814-235-8430or [email protected].

Page 5: The new Chapter 78a regulations have arrived - PIOGA · Page 4 The PIOGA Press Township, et al. v. Commonwealth of Pennsylvania, 623 Pa. 564, 83 A.3d 901(Pa. 2013); Robinson Township,

February 2014 Page 5October 2016 Page 5

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Page 6 The PIOGA Press

EPA extends deadline for ban of ‘unconventional’ wastewater discharges to POTWs

The U.S. Environmental Protection Agency has extendedthe deadline by three years for onshore oil and natural gasextraction facilities that were lawfully discharging to pub-

lically owned treatment works (POTWs) between April 7, 2015,and June 28, 2016, to comply with its rule prohibiting the dis-charge of “unconventional oil and gas” wastewater to POTWs.The new deadline for implementation is expected to be August29, 2019.

When the EPA published its final rule on June 28, it initiallyseemed to be nothing of concern; Pennsylvania’s unconventionaloperators stopped using such facilities in response to a “request”by the Department of Environmental Protection several yearsago. However, as we explained in a PIOGA Action Alert in theJuly PIOGA Press, a closer look at the technical developmentdocument (TDD) referenced in the rule showed that operatorsproducing from several conventional formations also would beswept into the EPA’s discharge ban.

The EPA’s June 28 final rule defines “unconventional oil andgas” (UOG) as “crude oil and natural gas produced by a welldrilled into a shale and/or tight formation (including, but not lim-ited to, shale gas, shale oil, tight gas, and tight oil),” with no fur-ther clarification in the regulatory text or preamble as to howagency was defining “shale and/or tight formation,” other than apreamble reference to the June 2016 TDD for additional infor-mation.

While the TDD cross-references several other definitions asbeing “generally consistent” with the new Final Rule definition,including Pennsylvania’s definitions of “unconventional forma-

tion,” “unconventional well” and “conventional formation,” itbecame clear that the EPA’s definition would not be consistentwith Pennsylvania’s definitions. In fact, a list referenced in theTDD includes the Devonian, Clinton-Medina and Tuscarora for-mations—which as we all know have been drilled for decades inPennsylvania as “conventional” formations—in addition to theMarcellus and Utica shale formations.

A number of PIOGA members producing in the Devonian,Clinton-Medina and Tuscarora have reported sending their pro-duced water to POTWs. Under the June 28 final rule, this prac-tice was to be prohibited effective August 29, 2016.

PIOGA and others contacted EPA to make it aware of itserror. Among those reaching out to the agency werePennsylvania congressmen Glenn “GT” Thompson and MikeKelly. They emphasized that denying producers this solution fordisposing of their wastewater would have an impact beyond justthe oil and gas industry.

“In communities across Pennsylvania, water from convention-al gas wells is treated at publically owned facilities,” Thompsonsaid. “Small towns and townships could miss out on hundreds ofthousands of dollars if the EPA doesn’t go back to the drawingboard to clear up confusion over this rule.”

As evidence of the rule’s potential impact, Thompson andKelly pointed to Ridgway, Elk County. Officials there estimatedthe borough would be denied approximately $630,000 per yearshould the final rule not be altered.

In writing to the EPA, Thompson and Kelly asked that theagency provide clarity on this issue and that assurances be pro-

Page 7: The new Chapter 78a regulations have arrived - PIOGA · Page 4 The PIOGA Press Township, et al. v. Commonwealth of Pennsylvania, 623 Pa. 564, 83 A.3d 901(Pa. 2013); Robinson Township,

February 2014 Page 7October 2016 Page 7

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Page 8: The new Chapter 78a regulations have arrived - PIOGA · Page 4 The PIOGA Press Township, et al. v. Commonwealth of Pennsylvania, 623 Pa. 564, 83 A.3d 901(Pa. 2013); Robinson Township,

Page 8 The PIOGA Press

vided to publically-owned treatment facilities that they wouldbear “no additional costs” while a final rule is drafted. The letteralso requests assurance that the rule would not impact waste-water derived through conventional drilling that is currentlybeing treated through existing POTWs.

EPA responseOn September 30, the agency published a direct final rule that

extends the effective date of the prohibition to August 29, 2019,for “UOG extraction facilities” that were discharging to POTWsduring the period between the proposed rule (April 7, 2015) andthe final rule (June 28, 2016). If the EPA receives “adverse com-ments” to the extension during a public comment period thatruns through October 31, it will withdraw the direct final ruleand it will not take effect. If that occurs, the EPA will proceedwith a proposed rule that will be a more formal vehicle to extendthe deadline.

While the extra three years of breathing room are welcomefor conventional producers using POTWs for their wastewater,PIOGA will continue to work to demonstrate to the EPA that itsdefinition of “unconventional” is incorrect. ■

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PIOGA’s Environmental Committee is pleased to host theupcoming Air Quality Compliance Training event takingplace on Thursday, December 8, at The Chadwick, in

Wexford. This training is part of PIOGA’s 2016 TechnicalSeminar Series and is being held in conjunction with our part-ners All4, Inc. and Clean Air Engineering, Inc.

The course will provide a basic understanding of the factorsthat influence air emissions and an overview of the regulations asthey relate to oil and gas operations, compliance and testingmethods. The five-hour class will cover the following topics:

• Introduction to Federal Air Quality Regulations• Demonstrating Compliance with 40 CFR Part 60, Subpart

OOOOa• A Field Guide to Subpart OOOOa Testing• RICE Compliance Requirements for Owners and Operators• A Field Guide to RICE testing• 40 CFR Part 98, Subpart W Reporting Thresholds and

Emissions Estimating• LDAR Tools of the Trade and Demonstration• Regulatory Updates• Next Generation ComplianceRegistration is now open and the fee includes lunch as well as

continuing education units. Cost is $100 for PIOGA membersand $150 for nonmembers. Go to www.pioga.org > News/Eventsto register online. Direct any questions to Tracy Zink [email protected]. ■

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February 2014 Page 9October 2016 Page 9

Don’t miss PIOGA’s annual meetingJoin us in wishing Lou D’Amico ‘Happy Trails’

We hope you’ll join us on the afternoon of Thursday,November 3, for PIOGA’s Annual MembershipMeeting, along with a retirement celebration reception

for President & Executive Director Lou D’Amico. The eventtakes place at the DoubleTree Pittsburgh Cranberry, and there isno cost to attend.

The annual meeting runsfrom 2 to 4 p.m. and providesmembers an opportunity tolearn about the work of theassociation on legislative, regu-latory, legal and education mat-ters that impact your business.Included will be introductions of board members, reports fromPIOGA’s board chairman, executive director and committeechairs, and an open forum for members.

As we reported last month, Lou D’Amico is retiring after 44years in the industry, including 22 years as the executive ofPIOGA and its predecessor, the Independent Oil & GasAssociation of Pennsylvania. We will celebrate Lou’s long andsuccessful career with a reception from 4 to 7 p.m.

Register to attend under the Events listing on PIOGA’sMembers Only website, members.pioga.org. If you needovernight accommodations, take advantage of the special $129rate by calling 724-776-6900 and mentioning the PIOGA mem-bership meeting. ■

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Page 10: The new Chapter 78a regulations have arrived - PIOGA · Page 4 The PIOGA Press Township, et al. v. Commonwealth of Pennsylvania, 623 Pa. 564, 83 A.3d 901(Pa. 2013); Robinson Township,

PIOGA’s ‘new’ committee liaisonand senior administrative assistant

Staff member Tracy Zink has a new title andnew duties. As committee liaison and senior

administrative assistant, she is responsible forassisting with all aspects ofPIOGA’s office administra-tion, including memberinquires and services andproviding support to thePIOGA staff. Tracy alsoserves as the committee

liaison, helping to facilitate monthly meetings,committee-related events and managing commit-tee membership.

You can contact her at 724-933-7306 ext. 23 [email protected]. Congratulations, Tracy! ■

Page 10 The PIOGA Press

By Joyce TurkalyDirector, Natural Gas Market Development

The mission of the Department of Community and EconomicDevelopment (DCED) is to foster opportunities for businesses togrow and for communities to succeed and thrive in a globaleconomy. PIOGA’s Pipeline and Gas Market Development com-mittee invited Denise Brinley, DCED’s special assistant forstrategic industry initiatives, to speak at our October 6 meeting inHarrisburg. Given Pennsylvania’s access to natural gas, her pres-entation highlighted potential downstream opportunities alongthe East Coast in light of the ongoing pipeline infrastructurebuildout, brownfield properties thathold great potential for redevelop-ment, and the existing industrialand manufacturing base positionthe Commonwealth has identifiedfor future business partners.

Ms. Brinley’s bio includes bothpublic and private endeavors. Priorto working at the DCED, whereshe is in charge of assisting theagency with developing invest-ment, business development andrecruitment strategies for the Commonwealth, she worked forTRC, an engineering and environmental services firm, where shesaid she learned a great deal about pipeline development. BeforeTRC she held various appointments with the Department ofEnvironmental Protection.

The marked decline in coal-fired electric generation has led toretirements of plants across the Commonwealth. These sites havepremier access to rivers, roads, rail, utilities and transmission,which demands a comprehensive statewide effort to market andincentivize the locations for repositioning and redevelopment.Ms. Brinley noted that the state was awarded $1.36 million infederal dollars to be used for pad-ready development. As anapplicant for funding, Ms. Brinley also mentioned that under thePOWER Initiative, the state has received a $65 million grant thatwill seek to address workforce development of displaced coalworkers and look at redevelopment of existing coal sites. First

Energy, NRG and Exelon are working alongside DCED to evalu-ate how you walk a site through divestiture; the first site hasalready been identified as the Mitchell plant in southwestPennsylvania. More on POWER can be found atwww.eda.gov/power/files/2016/funds-announcement.pdf.

Her position on pipeline development was for pipeline opera-tors/developers to demonstrate benefits to the state, not to simplytraverse the state and expect public support. Ms. Brinley indicat-ed that her department would like to be in discussions early on inthe route planning so that offtake options within the state wouldbe considerations. In speaking to the potential of the petrochemi-cal market, she said, “There’s a great deal of resource to dosomething with—for our own competitive advantage.” She fur-ther commented that Pennsylvania is the only state in this regionto permit a cracker plant. When asked if Shell picked the regionsolely for tax incentives, she said that the site demonstrated that70 percent of the polyethylene market resides within 700 milesof the site.

Some of the feedback Denise received by PIOGA memberswas the concern that Pennsylvania administration, namely theDepartment of Environmental Protection, is not meeting theneeds to attract new business investment in energy explorationand production and with that creates an environment of uncer-tainty and unpredictability to downstream demand centers, ver-sus one where businesses feel confident and can thrive and grow.The committee members pointed to DEP’s need to be funded byfines, something that appears directly counterintuitive to buildingout the market.

Ms. Brinley’s department is soliciting advice from the privatesector, leading what she referred to as a Team PA FoundationStudy: findings that will help the state determine how to buildbusiness opportunities focused on natural gas liquids. A futurecompanion study will be requested on natural gas opportunities.

Continued engagement opportunities and education wasagreed on by all. It is clear that DCED and PIOGA’s Pipelineand Gas Market Development Committee can demonstrate boththe benefits to the Commonwealth that stem from links betweenabundant reliable energy and economic and community develop-ment. ■

DCED’s Brinley talks about promoting Pennsylvania’s energy assets

Denise Brinley

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February 2014 Page 11October 2016 Page 11

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Page 12 The PIOGA Press

Burt Waite steps down fromPIOGA’s Board of DirectorsBy Matt BensonDirector of Internal Communications

The reality of any organization like ours with a board ofdirectors is that board members come and they go,whether due to elections, job changes, their company

deciding not to renew its membership or any number of otherreasons. Board turnover is often good, bringing new enthusiasmand innovative ideas to the group.

At the same time, it’s difficult to see long-term board mem-bers leave. Often, they are the people you can count on to showup for meetings and events, shoulder projects, and capably repre-sent the association and the industry in a wide range of forums.Such is the case with Burt Waite, whose retirement from Moodyand Associates, Inc. at the end of September brings an end to a15-year tenure on the board of PIOGA and our predecessororganization, the Pennsylvania Oil & Gas Association(POGAM).

Of course, his association involvement goes back further thanwhen he joined POGAM’s board in 2001. Waite, who was seniorgeologist and hydrogeologist with the Meadville-based consult-ing firm, explains that his background and education were ingeology and hydrogeology. His first serious exposure to oil andgas came in the late 1970s and early ‘80s, when Moody andAssociates ran several limited partnership programs, raisingmoney, drilling and producing oil wells in Venango County.

“I ran that for Moody & Associates, and it was my introduc-tion to hands-on oil and gas work,” he recalls. “During that time,I did everything—I was the geologist, I did the permits, Idesigned the E&S, I even worked as a hand on the rig when itwas necessary just to get it all done.”

In the early 1980s, the Department of EnvironmentalResources (forerunner to today’s Department of EnvironmentalProtection) put out for bid a project called the Oil and GasPollution Abatement Program, which Waite explains was a studyof the impact of oil and gas activities on surface water that even-tually became part of the agency’s justification for revisions tooil and gas regulations in the mid-‘80s. Moody and Associateswas awarded the project, which led to the firm—and Waite par-ticularly—consulting on environmental and water-related issuesfor the industry. That in turn created a path to considerableinvolvement in POGAM, PIOGA and state advisory boards.

As environmental issues became of increasing importance tothe industry, Waite found he was working more and more to helpthe association ward off threats and help find solutions. He wasinvited to run for a POGAM board seat in 2001 and continued onthe board through the 2010 merger of PIOGA with theIndependent Oil & Gas Association of Pennsylvania to formPIOGA.

Waite emphasizes that he never used the position as a way topromote work for his employer.

“I always viewed it as, if the oil and gas industry is success-ful, I’ll be successful,” he explains. “I had a vested interest in theindustry growing and being successful, and I never wanted tojeopardize that role by trying to use [board membership] as away to promote business for Moody and Associates and myself.”

He notes that involvement in the association takes a commit-

ment not only on the part of the board member, but also by thatperson’s employer.

“While you’re at board meetings and preparing for boardmeetings, you’re not billing hours, which is how consultants earntheir living,” Waite says. “But at the same time we always felt itwas vitally important to our company and still have that philoso-phy for the most part.

“As the industry goes, so we go. We always tried to workshoulder to shoulder with the industry to do what is right andgood for the industry, to try to keep regulations and laws reason-able. Jeff will play that role even now that I’m not there,” hesays of Jeff Walentosky, who has taken on the responsibility ofrepresenting Moody and Associates on the board.

Waite also has been a member of several state advisory pan-els, including DEP’s Citizens Advisory Council, MiningReclamation Advisory Board, Environmental Quality Board, Oiland Gas Technical Advisory Board, and Conventional Oil andGas Advisory Committee. The latter will be disbanded soon andbe replaced by the Pennsylvania Grade Crude DevelopmentAdvisory Council, which was created this year by the same leg-islation that abrogated the Chapter 78 regulations for convention-al oil and gas operations. PIOGA has nominated Waite to serveas one of two representatives of the association on the new PennGrade council.

Waite observes that the relationship between the oil and gasadvisory boards and DEP has become very contentious in recentyears, including a shift toward providing input on broad regulato-ry packages rather than advising on specific technical matters, ashad been the traditional role of the Technical Advisory Board.However, with the nomination of Patrick McDonnell to movefrom acting to permanent DEP secretary (see article in thisissue), Waite is hopeful the department’s relationship willimprove.

“I think we have a secretary of DEP that is, if nothing else, agentleman and civil,” Waite says. “That doesn’t mean we’regoing to agree on everything, but I don’t think he’s going to beadversarial or confrontational. I think he’ll discuss issues withus. So I’m hopeful. I’ve known Patrick McDonnell for a while,and I’ve always found him to be someone who will listen to whatyou have to say, and then tell you what he thinks—not in thatconfrontational, antagonistic way of the last two secretaries.”

At the same time, Waite is less optimistic about a long-run-ning issue he lists as the top environmental challenge to

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October 2016 Page 13

Pennsylvania’s oil and gas industry—particularly the convention-al side. The traditional method of disposing of wastewater inPennsylvania has been through treatment to remove as much aspossible and then discharge into a stream or river to dilute thechlorides. The state and federal governments, however, have con-tinued to ratchet down onsurface discharge as a dis-posal method. Current exam-ples include the U.S.Environmental ProtectionAgency’s inclusion of anumber of conventional for-mations in its pending banon discharges of “unconven-tional” oil and gas waste-water by municipal treatmentfacilities (see article in thisissue), as well as DEP’scoming triennial review thatis expected to include limitsfor discharges of all chlo-rides.

“The days of conventionally treating what you can treat forand then diluting the salt in the rivers and streams, those days arerapidly coming to a close. At the same time, other alternativeslike underground injection have not developed fast enough todeal with the volume of water we have to deal with,” he says

Highlighting one bright spot, Waite lauded the unconventionalindustry for its success in recycling wastewater, but added: “Asmuch as I want to say we’ve solved this problem of brine man-

agement, we have not. In my mind, it remains the number-oneenvironmental challenge to industry in Pennsylvania.”

As he winds down his term on the board of directors, Waitesees PIOGA serving a unique role. With several other oil and gastrade associations representing narrow slices of the industry,PIOGA is the only organization that gathers everyone under onebig tent—unconventional operators, conventional gas producers,shallow oil producers, service companies, consulting firms, andnow the pipeline and end-use sides of the market. He says thebroad focus is a reflection not only on the board, but even moreso on long-time PIOGA President and Executive Director LouD’Amico, who is retiring too.

“PIOGA works harder at representing everyone than they aregiven credit for at times, I believe,” Waite says. “It’s very impor-tant for the industry to have PIOGA, the one organization thattries to work on behalf of the whole industry.”

Waite says he is ready to escape “the grind of being at mydesk at 7 and being there at 7 that evening,” but he still wants thepleasure of working and doing some consulting—just not everyday. “I’m still going to look for opportunities where I can be ofservice to the industry and remain a part of it,” he adds.

He also emphasizes that he isn’t moving to Florida or plan-ning any six-month cruises, but instead intends to enjoy the rootsthe Cochranton resident and his family have put down.

“I’m going to stay here with my kids and my grandkids andhopefully do a little bit of consulting and stay involved,” Waiteconcludes, adding that he greatly appreciates PIOGA’s backingto become a member of the soon-to-form Penn Grade advisorycommission.

We’re glad too that Burt Waite is sticking around. ■

We had to reschedule the Environmental Committee’s annual Divot Diggers Golf Outing to October 4 due to conflicts, but in the endwe had a gorgeous day and 16 foursomes to enjoy it. Perhaps fitting, it was also the day of the funeral of golf great Arnold Palmer.Thanks to our sponsors, we had a lot of great prizes and plenty of fun. Door prize winners are pictured above.

19th Annual Divot Diggers Outing

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Page 14 The PIOGA Press

Updated state forest plan reinforcesgovernor’s leasing moratorium

The 2016 update to the Depart ment of Conser vation andNatur al Resources’ (DCNR) State Forest ResourceManagement Plan incorporates Governor Wolf’s executive

order banning new oil and gas leasing in state forests, and theplan includes a new position statement on the management of oiland gas development in state parks and forests.

Wolf’s January 2015 executive order repealed an order by hispredecessor, Tom Corbett, which had called for new leasing ofstate forest lands if they could be drilled without additional sur-face impacts or could be accessed via directional drilling fromadjacent privately owned lands. Corbett’s plan was to generate$95 million in new revenue for the state through such leasing. Amoratorium on new leasing was first enacted in 2010 in the wan-ing days of Governor Ed Rendell’s term; Wolf’s executive orderreinstated the Rendell ban.

The state began leasing its forestland for oil and gas develop-ment in 1947. Development and gas storage leases issued byDCNR in state forests total 343,915 of its 2.2 million acres.Since 2008, DCNR has issued three shale-gas specific leasestotaling 138,866 acres. Nearly 650 shale-gas wells have beendrilled since then. Shale-specific leases have yielded the state$413 in bonus bid revenue and about $449 million in royalties.

DCNR said in its new position statement accompanying the234-page forest management plan that to better conserve theresources it oversees, the agency will “not permit additional oiland natural gas leases on state forest and park lands where

DCNR controls the subsurface rights.” To implement thisapproach, the two-page position statement says DCNR is com-mitted to the following actions:

• Closely manage and monitor oil and gas-related develop-ment and impacts on leased lands and lands where DCNR doesnot own the subsurface mineral rights.

• Protect state parks to the greatest extent possible by endeav-oring to limit surface impacts where DCNR does not own thesubsurface mineral rights.

• Require subsurface owners to provide definitive proof ofsubsurface ownership.

• Periodically update and publish findings from DCNR’s com-prehensive oil and gas development monitoring efforts, whichinclude evaluation of environmental, economic and socialimpacts.

• Actively purchase and exchange real estate interests toacquire subsurface oil, gas and mineral rights to conserve stateforest and state park lands.

• Continue to implement a robust public input process ifDCNR proposes additional leasing on state forest or park lands.

In addition, the department emphasized that it will pursue thefollowing outcomes:

• Develop, refine and adapt DCNR’s “Guidelines forAdministering Oil and Gas Activity on State Forest Lands” toaddress such activities as siting, time-of -year restrictions, noise,lighting, species protection and other measures.

• Develop recommended shale gas best management practicesfor privately owned forest land based on DCNR’s guidelines.

• Manage oil and gas leases and maintain cooperative rela-tionships with natural gas operators on state forest lands.

• Audit and enforce the payment terms of leases to ensure theCommonwealth receives proper rental and royalty payments.

• Train staff and implement new ideas for management aswell as maintain a working knowledge about developments andtrends in the gas industry.

• Gather and consider public input through DCNR’s advisorycommittees and State Forest Resource Management Planprocess.

• Work cooperatively with the Department of EnvironmentalProtection on gas development issues and the protection of pub-lic natural resources.

• Use the Pennsylvania Conservation Explorer (formerly thePennsylvania Natural Diversity Inventory Environmental ReviewTool) to assist in the conservation of native wild plants and otherimportant ecological resources in Pennsylvania.

The forest management plan was last revised was in 2007.DCNR received more than 4,000 comments and hosted 12 publicmeetings over two years as it developed this latest version.PIOGA provided comments in January on the draft plan.

The plan and supporting documents are at dcnr.state.pa.us/forestry/stateforestmanagement/sfrmp/2016sfrmp. ■

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February 2014 Page 15October 2016 Page 15

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McDonnell nominated aspermanent DEP secretary

With an affirmative vote of the state Senate, the “acting”will be removed from Patrick McDonnell’s title at theDepartment of Environmental Protection. Governor

Wolf nominated the DEP veteran last month to head the agency.McDonnell has served as actingsecretary since the resignationof John Quigley in May.

At the time McDonnell wasnamed acting secretary he wasserving as DEP director of poli-cy, overseeing the agency’s reg-ulation and policy developmentprocesses. In addition, he ranthe State Energy Office and wascharged with coordination ofrenewable energy and energy efficiency issues.

Before that, McDonnell was executive policy manager for for-mer Commissioner Pamela Witmer of the Pennsylvania PublicUtility Commission, focusing on electric, natural gas and waterissues as well as cybersecurity and the impact of environmentalregulation on energy markets.

Prior to his term working for Witmer, McDonnell spent 13years with DEP in a variety of roles . As deputy secretary foradministration, he managed the budget, human resources, infor-mation technology and oversaw the facilities management func-tions of the agency. He also previously served as policy directorand as an assistant to the special deputy secretary. He began hiscareer at DEP working in the State Energy Office on energy effi-ciency, renewable energy and green building projects.

McDonnell received his master’s degree in political sciencefrom Lehigh University and his bachelor’s in politics fromDeSales University.

It’s uncertain when the Senate will vote on the nomination. ■

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Page 16 The PIOGA Press

PIOGA Member News

ARG breaks ground for new $3 million lab

American Refining Group Inc. (ARG) leadership and keycommunity contributors and stakeholders gatheredrecently to break ground on the historic refinery’s new

$3 million Quality Lab. ARG has two Quality Labs (a main lab and a minilab in the

refinery’s Blending Plant) at its Bradford refinery with a staff of17 employees who, between them, support refinery operationsaround the clock; these in-house chemists and techniciansprocess 5,500 to 6,500 samples per month in addition to manag-ing equipment, performing verifications, calibrations and trou-bleshooting or repairing instruments.

The new building, at 6,400 square feet, will replace the mainQuality Lab currently in use. ARG worked with laboratorydesign firm LCS Constructors Inc. of Irvine, California, for plan-ning. The general contractor is Poole Anderson Construction ofState College. Shifting the lab’s operations will be done in phas-es as instrumentation will have to be carefully disassembled,moved and reassembled before being calibrated for use. Thefacility will include a general test lab, a gas chromatography anddistillation lab, a water/environmental lab and a thermal-test lab.The building will also comprise offices, storage, utility rooms,restrooms and a lunchroom that will also be used as a trainingarea.

Maxwell joins CME Engineering

CME Engineering announced the addition of E. BruceMaxwell, former Managing Director of Keystone ClearwaterSolutions, to the firm’s management team this week. Maxwellwill head CME Engineering’s oil and gas services as well as the

Are you takingadvantage of

PIOGA’s onlineMembers’ Only

system?

• Connect with other members

• Register for PIOGA events

• Search for products and services

• Access committee resources

• Update your membership profile

• Pay your dues

• Company main contacts can add/

delete other company contacts

• Update your profile

• Take advantage of government

advocacy and education resources

It’s easy and fast to log into your

account!Just click on the Members Only link at the top

of our homepage, www.pioga.org, and input

your username (usually your email address) and

password. If you don’t remember your password,

just click Reset my password and you’ll receive a

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February 2014 Page 17October 2016 Page 17

New PIOGA members — welcome!

The CFO Group8060 Steeplechase Circle, Argyle, TX 76226214-724-4174 • www.thecfogroupusa.comAssociate

MCS-Systems, Inc.219 Blood Road , Chester, VT 05143-8410802-875-1200 •www. www.mcs-systems.comService Provider – produce and sell “multi-channel” productiontubing, designed to dewater gas wells

Nacelle Logistics412 Tennessee Avenue, Charleston, WV 25320304-552-5242 • www.nacellesolutions.comService Provider – natural gas fueling, BTU Reduction, and NGLcapture and extraction services for the upstream, midstream andproduction market segments

POWER-GEN Natural Gas1421 S. Sheridan Rd., Tulsa, OK 74014918-832-9801 • power-gennaturalgas.comService Provider – conference organizer

Wilt joins Curry Supply withmore than 12 years of marketingexperience, most recently as globaldirector of marketing & communi-cations with an equipment manu-facturing company focusing on themining and aggregate industries.She managed the development ofthe corporate brand across thecompany’s locations in Asia,Australia, Europe, North Americaand South America. She has a Bachelor’s Degree in BusinessManagement with a Marketing Concentration from TheUniversity of Pittsburgh. Wilt is also taking classes to completeher MBA Degree.

Tom Catalano, Curry’s former director of marketing,announced his retirement in September. He was served in theposition since 2013 and played a huge role in developing andpromoting the Curry Supply brand. The company thanks him forhis hard work and dedication and wishes him well. ■

expansion of the office in Wheeling, West Virginia. He has morethan 20 years of experience, managing multiple facets of theenergy extraction industry including operational support for oiland gas, water assets, and environmental needs.

Maxwell will diversify CME’s business model to includeengineering support for producers and contractors working in theMarcellus and Utica shale plays. He will be stationed in theWheeling office, but will assist with all of CME’s operations inthe Pennsylvania, Maryland, West Virginia and Ohio markets.

Larson Design Group listed listed as a topgeospatial company

Point of Beginning (POB) magazine, a national publicationdedicated to the surveying and mapping industry, has listedWilliamsport-based Larson Design Group (LDG) among its top100 companies for 2016.

To be considered, companies answered a questionnaire aboutthe services they provide and their revenues. Companies werelisted alphabetically with stars indicating the revenue categorythe company falls into. LDG has a two-star ranking, indicating ithas over $1 million but under $10 million in land surveying,mapping, and geospatial revenues in calendar year 2015.

According to a news release from POB, “Among those com-panies looming large in geospatial revenues, Larson DesignGroup actively lists 3D scanning, GIS/asset management andsurvey among its services.”

Wilt Joins Curry Supply as director of marketing

Curry Supply is pleased to welcome Heather Wilt to the com-pany as director of marketing. She is responsible for the corpo-rate marketing strategy, advertising, management of the websiteand digital marketing, public relations, event management andpromoting the Curry Supply brand.

Introduce your company

Introduce your company and tell other members what youoffer to Pennsylvania’s oil and gas industry. The guidelinesfor making a PIOGA Member Profile submission are:• Include a brief history of your company. When and where

was it founded, and by whom? Is the company new to the oiland gas industry in general or to Pennsylvania?

• Describe the products and services you offer specificallyfor the oil and gas industry. Do you have a product in particu-lar that sets your company apart from the competition?

• If applicable, tell how the business been positively impact-ed by Pennsylvania’s oil and gas industry. Have you expand-ed, added employees or opened new locations?

• Include a website address and/or phone number.• Your submission may be a maximum of 400-450 words

and should be provided as a Word document. Use minimalformatting—bold and italic fonts are OK, as are bulleted ornumbered lists. Your submission is subject to editing forlength, clarity and appropriateness.

• Include your company logo or a photo. Images must behigh-resolution (300 dots/pixels per inch or higher) and in anycommon graphics format. Please include identifications forany people or products in a photo. Send image files separate-ly, not embedded in your document.

Email material to Matt Benson at [email protected]. This is afree service to our member companies and publishing datesare at the discretion of PIOGA. If you have questions, emailMatt or call 814-778-2291.

PIOGA Member Profile

Support the companies that support yourassociation with their advertising

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Page 18 The PIOGA Press

Act 13 decision: Continued from page 1

high court had remanded several matters back to theCommonwealth Court for resolution. This latest ruling by theSupreme Court’s Democratic majority was a mix of affirmationand disagreements with the Commonwealth Court.

PUC authority. Act 13 gave the PUC the power to reviewlocal oil and gas ordinances and withhold impact fee moneyfrom municipalities whose regulations went beyond what wasallowed under the statute and the Municipalities Planning Code.In Robinson II, the Supreme Court found that the uniform stateoil and gas zoning standards were unconstitutional and nullifiedsome of the PUC’s authority in this regard.

Agreeing with the Commonwealth Court in this appeal, theSupreme Court concluded (5-1, with Chief Justice Saylor dis-senting) that Sections 3305 through 3309 of Act 13 are not sever-able from certain provisions of the statute that were held uncon-stitutional in the 2013 decision because the PUC’s review is “nolonger capable of being executed in accordance with the originalintent of the General Assembly” in Act 13. Consequently, theseprovisions are invalidated and may not be applied or enforced.These provisions dealt with the PUC’s review of local ordinancesto determine whether they comply with Act 13 and theMunicipalities Planning Code, the procedures for mounting courtchallenges to local ordinances on grounds that they do not com-ply with one or both of those statutes, and the consequences to amunicipality if one of its ordinances is deemed invalid by such achallenge.

In a statement, the commission said: “The PUC has reviewedthe court’s ruling and accepts the decision without reservation.As a result of this decision, the PUC will continue to carry outits statutory obligation under Act 13 to collect and distributeunconventional gas well impact fees.”

“Physician gag rule.” Sections 3222.1(b)(10) and3222.1(b)(11) of Act 13 limit health professionals’ access to anduse of proprietary information regarding chemicals used in thehydraulic fracturing process. Reversing the CommonwealthCourt, the Supreme Court (6-0) found these provisions violatethe Pennsylvania Constitution’s prohibition of “special laws” thattreat certain members of a class differently than other members.

In a post on the Natural Gas Now blog, former DEP SecretaryMichael Krancer said this part of the court’s decision “is ironic(perhaps even perverse)” because these provisions were proposedby environmental groups and modeled after a Colorado law and,with these sections stricken, it could be more difficult for med-ical professionals to get information from the industry.

“The court actually struck the requirement, indeed the obliga-tion, that vendors provide information to health professionals. Atool that doctors and other health professionals had is no longeravailable to them,” he wrote.

Notification of water supply owners. Section 3218.1 of Act13 provides that if a hydraulic fracturing chemical or waste isspilled, DEP must provide notice of the spill to any public drink-ing water facility that could be impacted. The statute does notrequire DEP to provide notice to owners of private water sup-plies. The Supreme Court (4-2, with Chief Justice Saylor andJustice Baer dissenting), differing with the CommonwealthCourt, declared this also was an unconstitutional special law, butstayed that part of the decision for 180 days to give the GeneralAssembly “sufficient time to devise a legislative solution” to

eliminate the differentiation between public and private watersupplies.

The issue apparently will not be on the legislature’s agenda atleast for the remainder of this year. The ruling came with just sixdays remaining when both the House and Senate would be insession in 2016. “Oh, heck no. I doubt it will happen,” was theresponse of a House GOP spokesman when asked by a reporterif the matter would make it onto the chamber’s agenda.

“Whether the General Assembly views the court’s allowingadditional time ‘to craft remedial legislation’ as a directive topass specific legislation or an opportunity to decide how the leg-islators want to address this issue may have a lot to do with howthis process unfolds,” added PIOGA’s General Counsel KevinMoody.

Drew Crompton, a key Senate staff member who helped writeAct 13, opined in a published report that the activist court’sactivism threw out good regulatory language. He said many sen-ators do not support undue regulation of private water wells.“This is, at its core, a private property rights issue,” Cromptontold StateImpact PA. “At this point I don’t know what the correctremedial path is.”

DEP already alerts both public and private water supply own-ers that might be affected by a spill, a spokesman said, and thecourt’s decision will not change that. The agency “will continueto provide notice where the agency believes there may be apotential impact to water supplies,” he said.

Eminent domain. The court found (6-0) that Section 3241 ofAct 13, allowing surface properties to be taken in eminentdomain proceedings, violated the U.S. and Pennsylvania consti-tutions. In making this finding, the court disagreed with theCommonwealth Court.

Oddly enough, the provision has existed since the enactmentof the Oil and Gas Act of 1984 and was simply carried over inAct 13. “The Supreme Court has portrayed this as some specialdeal in 2012,” former DEP Secretary Krancer told Natural GasIntelligence. “It’s ridiculous, it’s been there since 1984.”

Krancer added regarding the full decision, “I really don’tthink these four points made here mean anything. It’s not a bigdeal in the grand scheme of things,” Krancer said. “There’s a lotof rhetoric in this opinion that the opponents will use...I thinkthis is the Supreme Court going into an academic exercise here.”

Ammunition for PIOGA’s suit against DEPThe Supreme Court’s majority opinion in the case reiterated

that public-resource protection provisions of Act 13 were nolonger in effect because of the court’s prior decision in RobinsonII. That’s a piece of good news as PIOGA appeals to theSupreme Court the Commonwealth Court decision that sidedwith DEP in finding that the department could continue to usethese provisions as part of its decisional process for drilling per-mits.

PIOGA also used the court’s confirmation of the existinginjunction as the basis for a September 30 request to the legisla-ture’s Joint Committee on Documents and the attorney general todelay publication of the Chapter 78a rulemaking until the provi-sions dependent on the enjoined Act 13 provisions are removed.The regulations were ultimately published on October 8 (seereport in this newsletter). ■

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October 2016 Page 19

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Page 20 The PIOGA Press

Natural Gas Futures Closing PricesAs of October 10

Month PriceNovember 2016 $3.266December 3.448January 2017 3.574February 3.569March 3.516April 3.230May 3.185June 3.208July 3.234August 3.233September 3,215October 3.229

SourcesAmerican Refining Group: www.amref.com/Crude-Prices-New.aspxErgon Oil Purchasing: www.ergon.com/prices.phpGas futures: quotes.ino.com/exchanges/?r=NYMEX_NGBaker Hughes rig count: phx.corporate-ir.net/phoenix.zhtml?c=79687&p=irol-

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February 2014 Page 21October 2016 Page 21

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Page 22 The PIOGA Press

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Cameron Energy Co 4 9/7/16 123-47898 Warren Sheffield Twp9/16/16 123-47897 Warren Sheffield Twp9/22/16 123-47895 Warren Sheffield Twp9/27/16 123-47896 Warren Sheffield Twp

Catalyst Energy Inc 5 9/6/16 121-45941 Venango Cranberry Twp9/8/16 121-45936 Venango Cranberry Twp9/12/16 121-45942 Venango Cranberry Twp9/14/16 121-45943 Venango Cranberry Twp9/19/16 121-45945 Venango Cranberry Twp

EQT Production Co 8 9/30/16 059-27104* Greene Washington Twp9/30/16 059-27106* Greene Washington Twp9/30/16 059-27111* Greene Washington Twp9/30/16 059-27108* Greene Washington Twp9/30/16 059-27109* Greene Washington Twp9/30/16 059-27110* Greene Washington Twp9/30/16 059-27112* Greene Washington Twp9/30/16 059-27113* Greene Washington Twp

David L Hill 1 9/10/16 083-56864 McKean Corydon TwpJKLM Corp 6 9/21/16 105-21870* Potter Eulalia Twp

9/22/16 105-21869* Potter Eulalia Twp9/22/16 105-21871* Potter Eulalia Twp9/22/16 105-21872 Potter Eulalia Twp9/22/16 105-21873* Potter Eulalia Twp9/22/16 105-21874* Potter Eulalia Twp

KCS Energy Inc 1 9/5/16 123-47691 Warren Watson Twp

PennEnergy Resources LLC 1 9/6/16 007-20484* Beaver New Sewickley TRange Resources Appalachia 7 9/26/16 125-28033* Washington Jefferson Twp

9/26/16 125-28034* Washington Jefferson Twp9/26/16 125-28028* Washington Jefferson Twp9/26/16 125-28029* Washington Jefferson Twp9/26/16 125-28030* Washington Jefferson Twp9/26/16 125-28031* Washington Jefferson Twp9/26/16 125-28032* Washington Jefferson Twp

RE Gas Dev LLC 3 9/6/16 019-22509* Butler Concord Twp9/6/16 019-22541* Butler Concord Twp9/6/16 019-22540* Butler Concord Twp

Red Jacket Energy LLC 7 9/6/16 083-56877 McKean Otto Twp9/9/16 083-56879 McKean Otto Twp9/14/16 083-56882 McKean Otto Twp9/19/16 083-56881 McKean Otto Twp9/22/16 083-56883 McKean Otto Twp9/27/16 083-56884 McKean Otto Twp9/30/16 083-56885 McKean Otto Twp

Rice Drilling B LLC 10 9/4/16 059-26892* Greene Center Twp9/4/16 059-26887* Greene Center Twp9/4/16 059-26888* Greene Center Twp9/4/16 059-26889* Greene Center Twp9/4/16 059-26890* Greene Center Twp9/4/16 059-26891* Greene Center Twp9/22/16 059-26969* Greene Jackson Twp9/22/16 059-26970* Greene Jackson Twp9/22/16 059-26971* Greene Jackson Twp9/22/16 059-26972* Greene Jackson Twp

Seneca Resources Corp 1 9/9/16 047-24976* Elk Jones TwpSWN Production Co LLC 8 9/8/16 115-22104* Susquehanna Franklin Twp

9/14/16 115-22105* Susquehanna Franklin Twp9/16/16 115-22200* Susquehanna New Milford Twp9/16/16 115-22202* Susquehanna New Milford Twp9/17/16 115-22201* Susquehanna New Milford Twp9/21/16 115-22207* Susquehanna New Milford Twp9/22/16 115-22208* Susquehanna New Milford Twp9/22/16 115-22209* Susquehanna New Milford Twp

Spud Report:September

The data show below comes from the Department ofEnvironmental Protection. A variety of interactive reports are

OPERATOR WELLS SPUD API # COUNTY MUNICIPALITY OPERATOR WELLS SPUD API # COUNTY MUNICIPALITY

available at www.dep.pa.gov/DataandTools/Reports/Pages/Oil-and-Gas.aspx.

The table is sorted by operator and lists the total wells report-ed as drilled last month. Spud is the date drilling began at a wellsite. The API number is the drilling permit number issued to thewell operator. An asterisk (*) after the API number indicates anunconventional well.

September August July June May AprilTotal wells 70 66 57 34 37 18Unconventional 49 48 49 27 32 14Conventional 21 18 9 7 5 4Gas 50 48 49 27 32 14Oil 20 18 9 7 5 3Combination oil/gas 0 0 0 0 0 1

Dan Palmer - Crude Relationship Manager PA / NY

[email protected]

Purchasers of Light Sweet Paraffinic Crude Oil

www.amref.com814-368-1200

mSpecialty Refining Solutions ®

Founded 1881 in Bradford, Pennsylvania. We are committed to supporting the local community,

creating sound jobs and a sustainable future.

Customer Focused - Service Driven

1500 Sycamore Rd., Suite 320Montoursville, PA 17754570-368-3040www.mctish.com

Additional OfficesAllentown, PAPittsburgh, PA

WINNERNortheast

2013

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PIOGA Board of DirectorsGary Slagel (Chairman), Steptoe & Johnson PLLCSam Fragale (Vice Chairman), Freedom Energy Resources LLCFrank J. Ross (2nd Vice Chairman), T&F Exploration, LPJames Kriebel (Treasurer), Kriebel CompaniesCraig Mayer (Secretary), Pennsylvania General Energy Co., LLCTerrence S. Jacobs (Past President), Penneco Oil Company, Inc.Thomas M. Bartos, ABARTA EnergyStanley J. Berdell, BLX, Inc.Carl Carlson, Range Resources - Appalachia, LLCMike Cochran, Energy Corporation of AmericaMike Colpoys, National Fuel MidstreamDon A. Connor, Open Flow EnergyTed Cranmer, TBC ConsultingJack Crook, Atlas Energy Group, LLCRobert Esch, American Refining Group, Inc.Michael Hillebrand, Huntley & Huntley, Inc.Jim Hoover, Phoenix Energy Productions, Inc. Gregory Muse, PennEnergy Resources, LLCBill Polacek, Environmental Tank & Container Stephen Rupert, Texas Keystone, Inc.Jake Stilley, Patriot Exploration CorporationWilliam Stoner, Universal Well Services, Inc.Todd Tetrick, EnerVest Operating, LLCMatt Tripoli, IMG MidstreamJeff Walentosky, Moody and Associates, Inc.Thomas Yarnick, XTO Energy

Committee ChairsEnvironmental Committee

Paul Hart, Fluid Recovery Services, LLCKen Fleeman, ABARTA Energy

Legislative CommitteeBen Wallace, Penneco Oil CompanyKevin Gormly, Vorys, Sater, Seymour and Pease LLP (ViceChairman)

Pipeline & Gas Market Development CommitteeBob Eckle, Producer Direct NGL’s, LLCRon McGlade, Monaloh Basin Engineers

Health & Safety CommitteeWayne Vanderhoof, RJR Safety, Inc.

Meetings CommitteeLou D’Amico, PIOGA

Tax CommitteeDonald B. Nestor, Arnett Carbis Toothman, LLP

Communications CommitteeTerry Jacobs, Penneco Oil Company, Inc.

StaffDan Weaver ([email protected]), President & Executive DirectorKevin Moody ([email protected]), Vice President & General Counsel Debbie Oyler ([email protected]), Director of Member Services and

Finance Matt Benson ([email protected]), Director of Internal Communications

(also newsletter advertising & editorial contact)Joyce Turkaly ([email protected]), Director of Natural Gas Market

DevelopmentDanielle Boston ([email protected]), Director of AdministrationLou D'Amico ([email protected]), Government Relations AdvisorTracy Zink ([email protected]), Committee Liaison and Senior

Administrative Assistant

Pennsylvania Independent Oil & Gas Association115 VIP Drive, Suite 210 • Wexford, PA 15090-7906724-933-7306 • fax 724-933-7310 • www.pioga.org

Northern Tier Office (Matt Benson)167 Wolf Farm Road, Kane, PA 16735

Phone/fax 814-778-2291© 2015, Pennsylvania Independent Oil & Gas Association

February 2014 Page 23October 2016 Page 23

PIOGA EventsInfo: www.pioga.org/events

Annual Membership Meeting & Lou D’Amico Retirement

Celebration

November 3, , DoubleTree Pittsburgh Cranberry, Mars

Annual Oil & Gas Tax and Accounting Seminar

November 30, DoubleTree Pittsburgh Cranberry, Mars

PIOGAtech Air Quality Compliance Training

December 8, The Chadwick, Wexford

Winter Meeting

February 1, 2017, Rivers Casino, Pittsburgh

Industry EventsPlatts 9th Annual Appalachian Oil & Gas Conference

October 25-26, Fairmont Pittsburgh

Info: www.platts.com/events/americas/appalachian/index

OOGA 2016 Technical Conference and Oilfield Expo

November 2, Pritchard Laughlin Civic Center Cambridge, OH

Info: oogatechexpo.com

Calendar of Events

➤ More events: www.pioga.org

Page 24: The new Chapter 78a regulations have arrived - PIOGA · Page 4 The PIOGA Press Township, et al. v. Commonwealth of Pennsylvania, 623 Pa. 564, 83 A.3d 901(Pa. 2013); Robinson Township,

115 VIP Drive, Suite 210Wexford, PA 15090-7906

Address Service Requested

www.BITCO.com

Insurance contracts are underwritten and issued by one or more of the following: BITCO General Insurance Corporation and BITCO National Insurance Company, rated A+ (Superior) by A.M. Best, A2 Stable by Moody’s, and A+ Strong by Standard and Poor’s.

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